23
Sep

Con Solutions: Payment Processing

One of the challenges we had this year was how to process credit card registration purchases. As an Internet focused con we decided to do what seemed natural: use our online site to process at-con credit card purchases. We purchased and set up some Apple iBooks and placed the computers at our registration desk. At these “kiosks” people would use the web browser to navigate to our registration site, add their registration, then use Paypal to pay for their credit card purchase.

In theory this should work out fine–the reality fell far short for reasons we couldn’t have known (but now do).

Apparently Paypal does not like if a number of purchases come from the same IP address range. In other words–if too many people use the same computer to pay for their items, Paypal assumes this is fraud behavior (regardless of any other evidence).

As a result we’ve had a number of issues where Paypal has nullified registration purchases. No matter what we submitted as a statement of proof, they still decided to reverse the charges. The most annoying part of this process is they appear to not even get input from the buyer before making their determination! Many of the people who’ve had their registration purchases reversed attempted to contact Paypal over this, but there does not appear to be any way for them to do so through the Paypal interface. Even those who actually called Paypal weren’t easily able to get them to understand that the charges were valid.

The worst element was that we are still wading through this situation over a week after the con ended. So we still don’t know if we’ll be receiving money from some people who attended the con, and we’re in the unenviable position of having to contact people to have them “re-pay” for their attendance. As anyone who has run an event knows–you don’t want to be in a position where you don’t know your operating budget or funding levels–and while we’re doing fine and will get through this, it’s still a huge hassle.

So, what does this mean for us? We’re ditching Paypal for credit card processing. We will be purchasing a credit card swipe system that is compatible with the iPhone for usage at the con next year, and setting up a merchant account for the online site. Yes, these will both cost us a monthly fee, and also cost money for hardware purchases–but quite frankly, they are absolutely necessary.

While free sounds good, it’s often more costly than it’s overall worth.

11 Responses to “Con Solutions: Payment Processing”

  1. cxc says:

    I think it’s great that you guys are posting about what didn’t work so well (in addition to praising what did). This really emphasizes the spirit of the con, which is everyone working together, recognizing problems, and rising above them. Admitting that the con is not perfect but is working to make things better in the future is really awesome, and I wish more cons (and people/companies/etc in general) were more like that.

  2. harknell says:

    We’ve always believed in sharing info–especially if it makes the entire scene better off. If anything we discovered can help another con or event do better, I’d be happy to pass that info along.

  3. I went through this when I first started taking credit cards at shows a few years ago… really what it comes down to is Paypal doesn’t want you using your store processing as a way to bypass subscribing to their virtual terminal (which does kinda make sense). I did get around it by using a dial-up connection to change IP’s between each transaction, but eventually I had enough credit cards coming in I just went with Paypal’s full credit card processing service. (Although if I were smart I’d get a different cc processor company since Paypal probably has the worst rates… but hey, convenience!)

    • harknell says:

      I can understand them not wanting to route around their services, but the reason we did this was so we didn’t have to handle anyone’s credit card info ourselves. Obviously this was a mistake and we won’t do it again.

  4. Chris Flick says:

    Well, I’m glad I caught this link in your Twitter feed. I recently got an iPad and one of the benefits I thought would be handy would be to take credit card payments via Paypal at a convention show.

    Shawn, I would be interested in learning more about what you had to go through. I don’t get a ton of credit card requests at shows but I’m beginning to get enough where I need to think this through or do some investigating. I was hoping the iPad would be an easy solution but it looks like it might not be after all…

  5. After signing up at https://squareup.com/ three months ago, they’ve finally just put my scanner in the mail. To their credit, though, they are a brand new company and they were still working on getting their ducks in a row. I’ll let you know how it goes. They charge 2.75% + 15¢ (no monthly fee) per credit card swipe but I believe that’s better than Paypal.

    • harknell says:

      One note on Square: Their support for the iPad/iPhone isn’t so great. The software is fine, but the swipe recognition is pretty bad–like 20% of the time it works. They’ve released some updates, but from what I understand it’s still pretty bad. To contrast this it has an 80% success rate on Blackberry and Android systems.

      Their dongle uses the audio system which isn’t the best choice for Apple products and leads to the swipe recognition issues.

  6. Anne says:

    wow that is complete crap. I actually considered paypal for taking payments at artist alley once but was worried the buyer could go home and claim they never got any item etc so decided against it but WOW now this is a problem too? a-freakin-mazing. I do not understand how paypal gets away with it. I’m sorry you guys have to deal with that I hope the swipe thing works out better :)

    • harknell says:

      Hi Anne,
      It just shows the limitations on some of the free services out there. If we had been receiving only a few payments it probably wouldn’t have been a big deal. Ultimately if you get enough credit card payments you need to go for a better system than Paypal.

      But to be fair to Paypal–they do what they do fine enough–but it’s just not right for us for this purpose.

  7. Well, I finally got my card reader from Squareup.com and I spent some time putting it through it’s paces. Sure enough, I did have some failed swipes but I do think it’s a matter of mastering how fast you do your swipe. Do it too fast or too slow and it fails. After a bit of practice, though, I was able to get it to recognize the card on the first try. I don’t take a ton of credit card payments and I think this will work well enough for my needs. Certainly beats lugging around my old school carbon copy swiper! I can just throw this little guy into my cash box and leave it there.

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